Global Virtual Power Plant Market Will Hit $5.5 Billion Value By 2023
NEW YORK (April 2, 2018) – According to the new research report published by P&S Market Research, global virtual power plant market is projected to reach $5,510.2 million by 2023, the market growth is mainly driven by the growing penetration of renewable energy sources in the energy mix across different parts of the world.
Virtual power plant refers to an integrated system consisting of centralized control system connected to power generating, distributing, and transmitting units which regulate, optimize, and manage the supply of electricity from distributed power generating sources to the consumers.
Insights on market segments
Demand response has been recording the highest share in the virtual power plant market, due to its lower development cost and higher operational efficiency. The technology also offers incentives to customers in the form of lower electricity bills in case the customers alter their electricity consumption during peak hours.
In terms of value, electric vehicles is expected to be the fastest growing consumer category in the virtual power plant market. The growing focus on the usage of pollution-free vehicles is boosting the demand for these vehicles in North America and Europe.
North America is expected to be the largest market for virtual power plants
Globally, North America has been leading the global virtual power plant market in terms of value, with an estimated share of more than 40% in 2017. The U.S. and Canada are focusing more on the promotion of clean energy sources including wind, solar, and other renewable sources of electricity. Also, these countries are investing in the upgradation of power evacuation infrastructure through innovative technological solutions such as smart grids. The ongoing addition of renewable power projects along with the development of smart grids are likely to boost the virtual power plant market in North America.
Growing capacity of renewable power projects is expected to drive the market growth
Renewable energy is growing at a rapid pace as majority of nations across the world are moving away from conventional sources of energy as they have limited reserves. Majority of nations are investing heavily in renewable power projects in order to increase the share of renewable energy in the overall energy mix. For instance, China plans to produce 150-200 GW of solar power by the end of 2020. The growth of renewable power projects, particularly distributed energy resources, will require advanced power evacuation infrastructure in order to ensure reliable supply of electricity, which in turn would call for greater construction of these plants. Thus, the growing need for effective utilization of renewable power projects is expected to encourage the growth of the virtual power plant market.
Fast-growing power sector in developing countries is laying opportunities for market growth
Countries such as India, Brazil, and Indonesia witness frequent power shortages due to low quality of power infrastructure. The rapid economic growth in these countries has helped in promoting investment in the power sector to support industrial and commercial activities. The growing investment in the power sector has resulted in growth opportunities for innovative solutions such as virtual power plants, which are needed for long term sustainability of newly developed power projects. Thus, the expanding power sector in emerging countries is laying opportunities for the growth of the virtual power plant market.
Virtual Power Plant Market – Competitive Landscape
Some of the major players operating in the global virtual power plant market are Enbala Power Networks, AutoGrid Systems Inc., Sunverge Energy Inc., AGL Energy Limited (AGL), Limejump Ltd, EnerNoc Inc., ENGIE Storage Services NA LLC, ABB Ltd., Schneider Electric SE, and Siemens AG.
[Ed. correction made 4/30/18: Original title read $5.5 Million. The correct figure is $5.5 Billion.]